Retail inflation latest data: In February 2025, India’s retail inflation rate (CPI) came down to 3.61%. This figure has come below 4% for the first time in the last six months. The main reason for this decline is said to be a decrease in the prices of vegetables. The retail inflation rate in January was 4.26%, which was revised. This figure of February is less than the estimates of economists. In such a situation, the question is also arising in the minds of the people that now the Reserve Bank (RBI) will cut more in interest rates?
Food inflation declines The main reason
The main reason for the decline in retail inflation is the decrease in food inflation. Food inflation came down to 3.75% in February, compared to 5.97% in January. The prices of vegetables declined by 1.07%, while it was showing an increase of 11.35% in January.
Apart from this, the inflation rate of grains was 6.1% in February, which is a slight lower less than 6.24% in January. At the same time, prices of pulses decreased by 0.35% in February, while in January, there was an increase of 2.59%.
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Economists’ opinion: Interest rates are possible
After a sharp fall in inflation, now the discussion in the market has intensified that the Reserve Bank of India (RBI) can cut interest rates in April. Experts believe that due to low inflation, RBI can take steps towards further softening monetary policy.
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Economist of Elara Securities, Garima Kapoor says, “The Consumer Price Index (CPI) was less than us and the market estimate in February, mainly due to a sharp decline in food inflation. Now we estimate that inflation rate for FY 2025 can go below 4.8%. We are expecting a repo rate cut of 25 basis points from RBI in April monetary policy.”
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DBS Bank (DBS Bank, Singapore) Senior Economist Radhika Rao said, “Inflation has decreased faster than expected, especially due to the fall in prices of vegetables and pulses. However, due to increase in gold prices, the core inflation has reached 4%. But after this decline, RBI may feel more comfortable to cut policy rates.”
Ahead
This decline in inflation rate is news of relief for the general public. However, it would be important to maintain stability in the prices of food items. Experts believe that if this trend continues, the RBI can cut interest rates in the coming months, which will provide relief to the borrowers.
